by Structured Settlement Watchdog
There's a new brand of snake oil in town and it's being dispensed by Black Square Financial.
In a video featuring what Black Square Financial puts forward as an explanation of present value and structured settlement factoring discounts, Black Square Financial chose to use 10% interest rate on a savings account, implying that a structured settlement annuitant could sell their structured settlement payment rights and in 2017 get 10% on a savings account.
To put things in perspective, interest on a 6 month CD peaked at 17.98% in August of 1981 and fell to a low of 0.29% in January 2010 [ Source: Money-Rates.com]. Black Square Financial is speaking of savings account interest...savings accounts like the ones banks used offer a free toaster as swag to those who opened them, 36 years ago.
Here are where the 10 Year Treasury Yields were at the start of each of the last 5 decades
1970s: 7.08 percent
1980s: 12.64 percent
1990s: 8.65 percent
2000s: 6.02 percent
2010s: 3.83 percent
2011- "Savings account rates don't have a full 1 percent to lose anymore"
[Source: Richard Barrington CFA, Huffington Post]
Black Square Financial is based in Coral Springs, Florida so to give them the shredded benefit of the doubt, I searched for the possibility that savings rates in Coral Springs Florida were an anomaly.
Then I broadened the search radius a little
Given the range of historical returns local rates being readily available why would Black Square Financial choose to use a savings rate not seen for more than 30 years in its example?
Is Black Square Financial ignorant or being deceptful? I'll let you decide.